Digital certification authority eMudhra has launched the eSign-based National Automated Clearning House (NACH) that helps large and small businesses collect recurring payments from their customers. This Aadhar-based digital payment system focuses mainly on eliminating the need for a wet signature to allow recurring payments. With the launch of NACH, eMudhra aims to reduce transaction costs and bring more accountability to transactions in the payment process.
In addition to bringing accountability, this move will encourage digital transactions and focus on promoting paperless electronic payments. Under this digital payment system, customers can authenticate their payments through a simple one-time password that is sent to their Aadhar-linked mobile number. Alternatively, customers can also authenticate recurring payments with the help of a biometric fingerprint scanner.
The company is hopeful that 95% of transaction costs can be eliminated with the help of this initiative. Moreover, this initiative will also establish a secure way of making payment. eMudhra has already been working with many banks on this initiative. Following this launch, the company expects to handle about 25 to 30 million transactions by next year. Banks and insurance companies that have partnered with eMudhra can now collect payments from their customers without any need for physical forms.
According to V Srinivasan, chairman of eMudhra, this initiative will help companies save a lot of money on transaction costs. By promoting digital and cashless payments, NACH will simplify the payment process for various state and central government bodies. He also added that this digital transaction process will eliminate any errors that can be found in the existing system.
eMudhra has already been working in the digital sphere to provide signing and authentication services for enterprise and retail customers. The company aims to promote electronic signing and paperless transactions throughout the country. The company believes that the launch of NACH will take digital transactions to the next level and enable effective banking solutions in India.